Householders who took the time to sort their waste for recycling will be disgusted at the fact that it was then taken away and surreptitiously dumped in hastily dug holes in the ground where it lies festering, with noxious gases bubbling to the surface.

The landfill site on the Mobuoy Road area lies beside Campsie Sand & Gravel Ltd where it's understood two arrests were made earlier this week. It is one of five locations identified as having had hundreds of thousands of tonnes of waste dumped on them and buried without proper procedures.

The Faughan Valley is an area of outstanding natural beauty, with lush valleys, ancient woodlands and rolling hills. The picture postcard scenery is so striking that it was recently the subject of a major tourism campaign, spearheaded by Derry City Council.

The public may now have to foot the bill for the cost of the massive clean-up.

It is believed much of the illegal dumping took place under the cloak of darkness.

The land was systematically torn up and waste dumped into the void before being covered over with topsoil and other materials.

There is little to no trace of the pollution and damage that has been done on the surface, but the scale of the illegal disposal is truly astounding.

Hectare upon hectare has been affected in the illegal operations, with the scale still being calculated. Waste from two council areas has so far been identified however, as well as waste from various businesses.

The vice-chairman of the Waste Programme Board – an advisory body to the Department of Environment – described the scale of the dumping at sites in the Mobuoy area as "massive" and "unbelievable".

Shaun Gallagher said a major clean up operation would now have to be affected to deal with land contamination and potential poisoning of the River Faughan. The sheer size of the potentially catastrophic pollution underfoot has taken everyone by surprise.

An investigation is set to begin on why no public body was able to pick up on the illegal dumping, which is known to have been going on since at least 2009, and how the people responsible were able to become involved.

The newly-installed chairman of Derry's Environmental Services Committee, SDLP Councillor Sean Carr, said news of the dumping had come "like a bolt out of the blue". He added that questions were likely to be asked once a fuller briefing was received from the environmental authorities.

A spokesman for the DoE, when asked whether government officials felt any responsibility for the illegal activities not being picked up sooner said last night: "The deception was sophisticated, with material mangled to hide its source and the illegal landfill top filled with clay and sand to cover tracks and cover-up crime.

"Organised crime has the ability to deploy this level of deception. While acknowledging this, the minister has directed that more investigation is needed.

"That is why he announced yesterday that Chris Mills, the ex-chief executive of the Welsh Environment Agency, has been called in to conduct a robust review of how DoE and its relevant units managed issues around this particular waste management facility in the past and how the units fulfil their functions now and in the future.

"The minister is determined that the full story around this site is told, that lessons are learned and that there is accountability."

He added: "The information that instigated the investigation was received in spring 2012.

"The Mills review will, among other things, critically examine what transpired in relation to the waste facility, the work of DoE units, how the units conducted themselves, what was known and not known and be up front as to whether the department had reason to act earlier in relation to the operation of the waste premises or in relation to the illegal land filling in the Mobuoy area.

"The minister has made it clear that the Mills work will look at any information coming to or held by DoE in relation to all the issues around this matter."

The spokesman said that all local councils had a responsibility to know where their waste was ending up. "The minister has made it clear that councils have a duty of diligence around waste contracts, about where waste was going in the past and where in the future. He believes that all councils need to address this immediately, he will be looking to see this done, at the end of which questions that arise will have to be answered."

He added: "I believe the polluter pays and hopefully there will be assets from whoever it is that dumped it, but that could well be long term."

'It could cost hundreds of millions to clear up mess'

The cost of cleaning up the massive illegal dumping operation uncovered in Co Londonderry could run into hundreds of millions of pounds, it was claimed last night.

The vice-chairman of the Waste Programme Board – an advisory body to the Department of Environment – said that taxpayers and Derry City Council's ratepayers may have to foot part of the bill.

Shaun Gallagher said that a major clean-up operation would now have to be effected to deal with land contamination and potential poisoning of the River Faughan.

Mr Gallagher, who is also a Derry City Councillor, said: "At this stage we know this illegal dumping has been going on on a massive scale and the cost of cleaning all this up could run into hundreds of millions of pounds.

"What will have to happen is that all the waste will have to be removed and also the contaminated soil around that as well. You have to lift it all.

"We won't know what's there until we dig into it.

"They have established its illegal waste but the true nature of it remains to be seen."

Environment Minister Alex Attwood – who chairs the waste board – revealed details of the massive investigation that is being conducted by various environmental agencies in conjunction with the PSNI.

Arrests have also been made as part of the largest investigation into illegal dumping ever staged in Northern Ireland.

Two people have been arrested in connection with Operation Sycamore, which was instigated over a year ago after a tip-off from a worker within the department.

While no-one has been charged to date, a file is expected to be passed to the Public Prosecution Service.

Mr Attwood said a staggering amount of waste, running into hundreds of thousands of tons, has been uncovered, much of it mangled and shredded to hide where it came from.

An unspecified number of landowners have now had notice served on them to take immediate remedial action to clean up the sites and ensure materials are disposed of properly.

In light of what has been uncovered in Derry, a waste crime taskforce has now been established.

Mr Attwood said he will be seeking extra resources to expand the Crime Unit's work.

A total of 25 other sites across Northern Ireland will now be subjected to an audit in light of what has been uncovered.

The former chief executive of the Welsh Environment Agency, Chris Mills – who closed down 270 illegal waste sites during his tenure – has been enlisted to conduct an assessment of the approach and practice regarding waste issues within the DoE.

The Water Service Northern Ireland yesterday assured people that the drinking water originating from the River Faughan was safe to drink.

The Faughan is used as a source of drinking water for the people of Derry and the surrounding area.

Environment Minister Alex Attwood revealed on Wednesday that tests were being conducted on the river as some of the illegal dumping sites are very close to it.

Tests have been conducted amid fears that it may have been contaminated from the illegal rubbish leaking into the river system.

A spokeswoman for Northern Ireland Water reassured the public, saying: "If there was any concern with any of the water sources, our treatment centres would pick that up.

"Thousands of samples are taken every day by scientists and the treatment processes pick up any differences in water quality and any changes in that would be detected early and acted upon."